RIVERRIDGE, La. -- The way money is distributed from a $20 billion oil spill fund entered a new phase on Wednesday.
Kenneth Feinberg, who is in charge of the Gulf Coast Claims Facility, said the emergency payments will now transition to a program involving a final payment. How claimants get that final payment will require them to choose between two options -- one of which has a major string attached to it.
'Whether they were granted or denied an emergency payment, they will be granted an opportunity to get another or a new check,' Feinberg said.
For Mark Martinez, the past seven months have been filled with anxiety, as he tried to keep his River Ridge seafood restaurant afloat in the wake of the BP oil spill.
'We really struggled at first and it really took a lot of work on our part,' he said.
Martinez is one of 175,000 people who received emergency payments from the oil spill fund. He now faces a choice for any future payments.
The first option is lump sum payment, based on present and future losses. The amount of the payment will be determined by the claims facility, though there is an appeal process. The major drawback: a claimant gives up all rights to sue either BP or any other company who may be responsible for the Gulf spill.
'I hope that my lump sum payment will be sufficiently generous to take into account the unknown future, that many claimants will see the wisdom of taking the lump sum payment and move on with life,' Feinberg said.
The second option involves a series of quarterly payments, based on losses suffered within each quarter for three years. This option allows claimants to keep their right to sue, but it has its own drawback.
'If you take a quarterly payment and down the road you come back and say, 'Okay, now I'm ready for a final payment,' there is no guarantee that final payment will as generous as it would have been if you had started out,' Feinberg said.
The options are giving claimants like Mark Martinez a lot to think about, as he considers just keeping his options open.
'How much better are they going to get and how fast is that going to happen?' Martinez said. 'I would say I think the quarterly payments is kind of the way we're going to steer for the time being.'
The claims facility began accepting filings for the new payments on Wednesday and already have 7,000 in the system. As for people who are still waiting on emergency payments, Feinberg said all of those claims should be processed by Dec. 15.